8 April, 2016
The risk off sentiment saw Gold prices posting strong gains in yesterday's trading. Today's price action is seeing a pullback to the gains from yesterday with 1230 being the critical level of interest. A close below 1230 could see the gains being erased while a successful test at 1230 and a move higher could see Gold potentially move towards 1250 levels. Meanwhile, EURUSD has started to trade sideways indicating a potential breakout trade likely to emerge.
EURUSD Daily Analysis
EURUSD (1.13): EURUSD remains trading sideways despite the market turmoil and the flight to safety, seen yesterday. The daily chart for EURUSD shows no conclusive evidence for the moment, clearly showing that the momentum is flat at the moment. Resistance at 1.147 remains in place and is pending a test of this level, while support at 1.13 comes to the downside. The 4-hour chart shows EURUSD currently trading near the lower median line with the past couple of sessions trading within a doji inside the bar. A breakout from this doji could see further bias being established, with a view that EURUSD could dip towards 1.13 in the near term.
USDJPY Daily Analysis
USDJPY (108.7): USDJPY closed yesterday at 108.21, and the daily chart is currently showing some bullish momentum, but still too early to tell. On the 4-hour chart, the newly plotted median line (dotted) shows USDJPY falling towards the lower median but the failure to find dynamic support off the lower median line indicates some upside potential. Broken support near 111.31 - 110.67 could be tested for resistance in the near term unless USDJPY resumes its bearish declines again. Stochastics do not offer any additional information at the moment so it is likely that USDJPY could either take a breather from the declines or resume its downtrend sooner or later.
GBPUSD Daily Analysis
GBPUSD (1.40): GBPUSD was bearish yesterday, but trading was limited to the previous day's range. The inside bar along with the Stochastics currently near the 20 level could see a short term move higher to 1.42. On the 4-hour chart, we see a bullish divergence on the Stochastics, which could see GBPUSD rally towards 1.422 - 1.42 level of new resistance for a test. The bias remains to the downside as long as this new resistance holds.
Gold Daily Analysis
XAUUSD (1237): Gold pushed higher yesterday, and the current price action is showing a potential dip towards 1230 ahead of further gains. On the 4-hour chart, the current consolidation comes after a strong rally from the previous sessions. If the bullish flag pattern is formed here, Gold could test the levels of 1252 on a break above 1241 top that is formed currently. To the downside 1230 will be key to watch as a break below this level could see Gold post a strong correction to the downside.
The common currency which had fallen sharply over the past few weeks and was eventually seen hovering above the support level of 1.1540 level was seen...
The U.S. dollar fell sharply across the board yesterday after the U.S. President Trump in an interview...
The U.S. dollar lost ground yesterday amid a slow trading day with lack of any clear catalysts for the markets. The speech by Janet Yellen did not offer anything new for the markets...
Mexico's inflation is likely to be boosted higher as the government announced that it would be hiking fuel prices by nearly one-fifth from January. The government said that fuel price ceilings will be capped between 14.2% - 20% above December's prices...
The Institute of Supply Management's Purchase Managers Index data is one of the most widely watched indicators. It is considered to be a leading indicator which gauges the strength in the U.S. manufacturing sector...
A fairly quiet Monday saw USDJPY retreating from its recent highs ahead of the big events this week. USDJPY has retraced its gains and now trades just above the support level of 104. The markets look to another slow day today with no major events on the tap, leaving the bulk of trading on the technical aspects...
A quiet economic calendar today ahead of the FOMC and BoJ meetings this week could keep prices fairly flat. The US dollar looks well supported moving into the FOMC meeting first which could keep the euro subdued...
The Bank of England's decision to hold monetary policy steady saw the GBP surge against the US dollar, clearing 1.32 with 1.36 now coming into focus...
Political developments in Japan and the UK saw the respective currencies react in the positive. While the GBP managed to close bullish on news that Theresa May is likely to be the new PM...